Matt and I have been living on cash for two weeks. Experts always say if you feel cash leaving your hands you tend to spend less. I wanted to try that advice.
We took out a lump of cash every Saturday based on how much we planned on needing throughout the weeks. Last week it was $260; this week it was $180.
Both times we ended up with some leftover at the end. I guess technically the week doesn’t start again until tomorrow at noon, but I don’t expect to spend $60 tonight, unless I get stuck in a ditch.
Here are three things I learned about myself using cash:
#1: Cash at the grocery store, while daunting, can work if you tally how much you’re spending. Make a mark for each dollar you spend and then marks for every amount more than 50 cents. I came within a dollar or two of what I wanted to spend both times. Using cash made it much easier to pass up impulse items and stick to the list.
#2: I am so used to charging everything and then paying it off at the end of the month that cash felt foreign to me. In fact, I felt an urge to spend all of my money by week’s end, exactly opposite the wisdom I often hear.
I think that has something to do with Quicken. When a charge appears in Quicken, I watch its impact on our budget. Cash in Quicken is a black hole. We take little cash out and are terrible at marking how it’s spent. So it ends up in a miscellaneous pot. That means it doesn’t impact our “watch” categories like food or entertainment. Basically, cash makes it easier for us to fool ourselves.
#3: We don’t spend a lot of money. We both work. We take care of kids at night. It’s snowy and cold. Where would we spend money?

This entry was posted on Thursday, March 1st, 2007 at 3:26 pm and is filed under Kara\'s finances, budgeting, cash, spending. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.